Yet every once in a while a skillful enough con artist like Nicholas Cosmo comes along who convinces people to forget the investment world axiom and just go for it anyway.

With last week's arrest of the alleged Long Island investment scammer it became painfully clear to thousands of private, small-time investors - including possibly hundreds in western Queens and in Maspeth, where Cosmo's Agape World Inc. had a Grand Avenue office - that they had just been taken for a very expensive ride.

Following an extensive F.B.I. investigation, Cosmo was finally arrested on January 26 on mail fraud charges connected to a classic Ponzi scheme that swindled more than 1,500 people out of approximately $370 million.

Robert Nardoza with the United States Attorney's Office for the Eastern District of New York told this paper that Cosmo is currently being held in federal custody at an undisclosed location, but declined to comment further as the case is still under investigation.

At his first bail hearing on January 29 in U.S. District Court in Central Islip, Federal Magistrate E. Thomas Boyle ruled that Cosmo would be held behind bars until his defense team increases its first offer of a $750,000 bail package.

Records show that only $10 million of the $370 million deposited by investors with Agape World Inc., and Agape Merchant Advance (AMA) between January 1, 2006, and November 30, 2008, was reinvested by Cosmo with commercial lenders.

The rest was squandered by Cosmo on bad commodities bets that cost him $80 million, restitution payments for previous fraud, and luxury expenses like limo rides and upscale hotels.

Though his case has been overshadowed by Bernie Madoff's $50 billion Ponzi scheme, perhaps the largest investor fraud in history, Cosmo's crime has hit home in Maspeth, where many residents fell victim to the scam.

"I feel absolutely cheated," said one Maspeth man who lost money to Cosmo, and agreed to speak on the condition that his name not be used. "I feel betrayed and ashamed for allowing myself to get in too deep."

The man, who described himself as a blue-collar worker, said he invested roughly $30,000 with Agape World Inc., and AMA between July and December of 2008.

"My plan was to do this for a year, recoup my initial investment and get out, that was it," he said. "I don't want to be a millionaire, I just wanted to take care of my family."

Stories like this one are common in Maspeth, where by several counts tens of people, if not more, lost money to Cosmo, though few victims of the scheme were willing to speak publicly about their involvement.

Councilwoman Elizabeth Crowley's office has already received half a dozens calls from victims of the fraud, according to the councilwoman's chief of staff, Lydon Sleeper.

"I know many local residents who invested are feeling the economic ramifications," Crowley said in a statement. "I am working with Postal inspectors and the district attorney to make sure any victim of the scheme knows where to go to contact the proper authorities to help expedite the investigation and work toward restitution."

Michael Terry, a certified financial planner with an office in Maspeth, said so far nobody has contacted him to ask for help recovering their investment losses.

It wouldn't matter, Terry said, because at this point most people stand little chance of getting their money back in full, if at all.

"That money's gone," Terry said.

Terry said Ponzi schemes - top-down pyramid systems wherein the first investors are paid dividends with the money put in by later investors - are common, though more prevalent during times of plenty.

"They go on all the time," said Terry. "Ponzi schemes tend to work best when the economy is going up and they get caught when the economy starts to plunge."

During periods of strong economic growth, people invest increasing amounts of money, said Terry, only to pull back once the stock market starts dropping.

After the back-to-back Madoff and Cosmo scandals, Terry said investors should remain weary of get-rich-quick investment opportunities for some time. But when the stock market and economy rebounds, said Terry, some investors will fall right back in the same trap.

"As the market goes up people will be back," Terry said.

Cosmo could watch the ups and downs of the economy for years to come from a prison cell. He faces up to 20 years in prison on the mail fraud charge. His next bail hearing has not been set, but Nardoza said it will likely happen in the next week.

Crowley pledged to continue working to resolve the scandal.

"I encourage anybody who was victimized by Cosmo to contact my office," she said.